Whistler's very economic base could be particularly hard-hit by the Harmonized Sales Tax (HST).
That's the message that Bill Vander Zalm, B.C.'s premier from 1986 to 1991, brought to the region last Saturday (May 8) as he raised alarms about the tax that will harmonize the five per cent Goods and Services Tax with the seven per cent Provincial Sales Tax on all products and services with few exceptions, starting July 1.
He held rallies in Pemberton and Whistler. The latter drew a sparse attendance in the gymnasium at Whistler Secondary School despite clear concerns in the community about how it will impact the local economy.
Speaking to about 20 people in Whistler, Vander Zalm said that the tourism and service industries would take a particularly big hit from the tax.
"It's the restaurant businesses, it's anything that's tourist-related," he said. "The grocery store, the hairdressers, these are the people that will undoubtedly take the beating more than others because of HST, and because people will have to pay a chunk of tax now, 12 per cent, when they buy their ski tickets or when they go golfing."
Vander Zalm has mounted a province-wide petition against the tax, arguing that government is using it to relieve itself of a deficit on the backs of consumers. It needs to gather signatures from 10 per cent of registered voters in every riding and in Sea to Sky it has already reached 13 per cent, according to campaign organizers.
The Pemberton rally drew about 40 people.
The HST is an example of a Value-Added Tax, a consumption tax that is levied on products and services so that retailers can recover the costs of obtaining them to begin with. It can be differentiated from B.C.'s current Provincial Sales Tax (PST) in that it applies to everything, whereas the PST has several exemptions.
The provincial government is introducing the HST as a way to create what it estimates could be 113,000 jobs in British Columbia because they say it will reduce costs for employers to do business.
If successful, the petition will be referred to a Select Standing Committee of the legislature. That committee has the discretion to table a report recommending that a draft bill, in this case to repeal the HST, be introduced at the first opportunity, or else refer the petition to the Chief Electoral Officer. The committee can also recommend against it.
However, the federal government passed legislation to implement the HST last fall. If the province decided to back out of the HST it would have to give billions of dollars back to the federal government and Ottawa would have to repeal legislation.
One of the signatories to the anti-HST petition is Carol Milan, owner of the Parlour Hair Salon in Whistler Village. She said in an interview that she opposes the tax because it will cost her more money on everything she buys, both for herself and her business.
"My personal product is going to have to go up and then that means my clientele, which is the lower scale of Whistler, is going to have to pay more and, you know, it's going to be a catch-22 if they do or not," she said.
West Vancouver-Sea to Sky MLA Joan McIntyre said she's sympathetic to constituents who are concerned about the tax but said businesses have been lobbying the province for the new tax system for years. The PST, she said, has not been good for B.C.'s economy.
"At every stage there is a tax, this PST on the good being produced or moved around, that businesses pay," she said. "They cannot deduct it, they don't flow it through their business so that at each stage, that business has to eat that tax or charge the consumers so you can pretty well guess what they do, it gets passed on to the final cost of the item.
"What we're doing is getting rid of that. We're taking that out of the production chain, the value chain, and we're replacing it with seven points at the end."
The Whistler Chamber of Commerce released the following statement on the HST:
"The Whistler Chamber of Commerce acknowledges the B.C. Chamber's support of HST to strengthen the B.C. economy and to create more jobs, lead to higher wages/higher standard of living and enhance job security for British Columbians.
WCC understands that introduction of HST shifts the tax burden from businesses to end consumers and that for many Whistler businesses in the tourism industry, despite the reduced administrative costs that are expected to flow from the introduction of HST, it will potentially inflate prices to the end consumer. WCC is committed to learning more about the potential impact of HST across its broad membership, communicating those details and to working with those affected sectors as appropriate."
The chamber is hosting workshops facilitated by the Canada Revenue Agency on how to prepare for the introduction of the HST.